Office-to-Student Housing Conversion - Ohio
Scenario modeling and underwriting for the repositioning of an existing office building into student housing. Included adaptive reuse cost analysis, lease-up modeling, and exit strategy sensitivity.
Client
General Partner
Time Spanned
1 Week
About Project
Project Overview
This project involved the adaptive reuse of a commercial office asset into a student housing development in Ohio. The client had already acquired the property and was moving into the pre-construction phase, seeking a comprehensive underwriting model to support capital structuring, scenario testing, and long-term hold planning.
Objective
To build a full-cycle model that incorporated an existing mortgage, structured construction debt, and modeled lease-up timing alongside refinancing and sale outcomes.
Scope of Work
Mayer Property Group developed a full development and operations model, accounting for:
1. Construction Financing + Refinance Strategy
A layered capital stack was incorporated, including PACE equity, partnership contributions, and a traditional construction loan. The model also featured a refinancing event mid-hold to replace short-term debt with permanent financing.
2. Lease-Up + Stabilization
The model included a 6-month lease-up window following construction completion, with assumptions tied to occupancy phasing, student demand timing, and stabilized revenue targets.
3. Exit & Hold Strategy
Both hold-and-refinance and build-to-sell scenarios were modeled, with outputs including return metrics under varying cap rate and hold assumptions. Sensitivity testing allowed the client to evaluate risk exposure under different exit timelines.
Outcome
The completed model served as a foundation for investor conversations and internal feasibility analysis. It provided a clear roadmap for development capital planning, expense forecasting, and refinance timing — all within the context of a conversion project with unique operational considerations.
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